Science is the way – is Gridcoin going to help it?
Introduction
One week ago I wrote an article about my first real crypto investment. So far I’m 20/80-Crypto/Fiat, but I’m definitely going to take advantage of the dumb that is currently happening and buy in again.
I have started writing on Steemit when I had literally no money. During the first months I managed to gain low amount of Steem, but at least something. At that time Steem was around 2 bucks, while the BTC was around 2600. Luckily I decided at that time that it’s about time to start learning trading. I managed to trade Steem/BTC for 0,00066 (which was as I see now one of the best ratio Steem ever had). Im totally aware of the fact that it was pure luck, but it gave me some BTC to operate with, so I started searching for speculations.
Right now I have exactly 10 altcoins in my portfolio, but I will definitely add more. Every article from this series will analyse one altcoin concentrating on the reasons why I bought it, its value from my perspective and expected gain. By this I can hopefully help others to make right decisions when selecting altcoins into their portfolios and avoid making mistakes like I did in first case, which was Gridcoin.
Gridcoin from noob’s perspective
I always wanted to support science. The centralized way of financing researches is from my perspective totally destructive. First idea that really caught my eye was that through such a Blockchain researches could be self-sustained. Not only the researches would be directly rewarded with crypto, but also anyone willing to lend their computing power.
Also according to its graph, the token was experiencing frequent pumps. This factor was important purely from the speculative point of view, but then again I wanted to make something out of the money I reserved for trading, so it was an important factor.
Also from the information I gathered, the token was minable even with not-so-great PCs. Not like I thought that I will make thousands by lending by shitty computing power, not at all, it was more like doing something for the cause you believed in. Also I was convinced that since my computing power was really bad, it would be able to drain to much energy. Since my PC was running all day long because of the fact that I spend several hours daily to write articles that hopefully have some value for someone, I could just lend the inactive CPU while working.
Lastly I was happy about its 1,5% interest. I had only Steem and BTC at that time, which provided no interest at all. Ok Steem in a way was through curator’s reward, but I felt like exploring the world of cryptocurrencies more.
I bought Gridcoin in 4 ways with an average rate of 0,00001250.
Gridcoin from (lesser) noob’s perspective
Now I wonder, is Gridcoin really a good coin for supporting science? Is there any value in it? Why would anyone buy the token from you? BOINC has been there for couple of years already and all of the CPU/GPU contributors didn’t get anything for their troubles. Gridcoin is great at supporting those who basically sacrifice their electricity and PCs for science. At least they get something out of it right? What is the something though really?
So having a stake of Gridcoin enables you to vote for any change that is being discussed for the token. When I tried to be active only about 15-25% of all the tokens “were voting” and frankly, I didn’t see any reason to vote on most of the things too.
Also a change has recently came to life, which drastically increase the amount of tokens one has to have in order to stake frequently. When I bought 1k of Gridcoin, it was due to the fact that it was enough to stake weekly. Now for that purpose tens of thousands of coins are necessary.
My PC surprised me too. It obviously managed to eat more electricity than thought is in its capabilities. The extra electricity cost me around 15 bucks while netting me basically nothing. Not a huge loss, but still not really to my liking.
The best part is definitely the 1,5% interest. It makes having tons of the coins worthwhile, counting with it not further losing value.
So who would actually buy the Gridcoin from me? Only speculators and those who are looking to build a huge pile of tokens to stake and enjoy the good interest.
Conclusion
If I had the knowledge about crypto I have now, I wouldn’t probably buy GRC. Truth is that I didn’t time it perfectly and was catching a falling knives a bit, but at least I didn’t screw that much to buy it waaay overvalued. The value of Gridcoin is lately around 0,00000900 and that puts me at around -25% loss. I’m not that sad about it, since I believe that sooner or later a pump will occur and I will be able to sell it at least at 0% loss and maybe even with a small gain. And if not I’ve learned my lesson.
HODL till pump it is!
Gain from trading
Every article about a cryptocurrency from my portfolio will be ended by my overall trading efficiency. I expect it to be more of a fun fact for a couple of months. Right now I stand at 0,1% gain! Lol everyone had to start somewhere…:D
Tell me about your first time experiences! Did you have more/less luck than me? What crypto did you opt for? Can’t wait to hear it!
When buying GRC, you pushed its price up a little which in turn might have attracted another person to BOINC and computational science. That very person might make a crucial contribution to an important scientific project tomorrow with his PC. There are tons of cryptos out there with far less real-world utility, which consume far more electricity, for far more useless tasks (PoW hashing) and have suffered far worse declines in market valuation recently.
I’m not implying that the token is useless. As I said its super good that those that lend their computing power to the scientific projects get rewarded. One though has to have a really good PC to gain something when counting in the cost of electricity. For me it was like throwing 15 bucks out of the window, but I understand...that competition was strong. If I had spare money i would support science even through this way, but I do not. I’ve done my share. Let’s hope others will continue.
I’m not saying that people shouldn’t support Gridcoin. If they have enough money to buy a huge stake then by all means everyone is free to go for it. The prize now seems really low too. I just feel that it lacks something extra that would make the coin more valuable.
First of, please stop calling Gridcoin a token... It's a coin, nothing else.
The reason you may feel that your 15 bucks was a waste is because the price has gone down again. But the reason that Gridcoin is low is because it's lack of big investors and adoption of miners. We will gain more miners as time passes, which will give more traders and volume. When the price goes up, more miners will come in.
Or we will have a price jump because of heavy investors, making it even more lucrative for miners to run BOINC. And trade volume may increase.
Gridcoin is at it's lovest and is stable at the level it's at now. Its going between 2.5 and 5-6 USD cents. But it has great potentials and just need more investors and/or miners.
Token = representation of the right to perform operation. Gridcoin enables you to vote with your stake, therefore it is ALSO a token. Token of course means even other things but this will do in this case.
I do hope so that the whole Gridcoin community will grow. I did not doubt its potential, merely the probability that it will fulfil its potential and will not be replaced by a better coin.
Let's not loose sight of the fact that a blockchain ledger is the thing giving value to all cryptos, not the incentive structures, not the smart contracts = ).
Some reading to help you determine the value of GRC:
https://steemit.com/gridcoin/@jringo/the-value-of-gridcoin-a-continuation-and-response-an-alternative-rain-proposal
Nice article. I do agree with you. Gridcoin is definitely better than most of the tokens out there.
Most of the Gridcoin enthusiasts here feel like i said it has no value at all, which is of course not the case:P I merely doubted its growth potential, since i thing there are so many coins in possession of the miners, that when the prize goes up due to a pump (new stake holder) the rest will just sell it. Maybe I’m wrong. Maybe we will see Gridcoin reaching dollar peg in the future. After I’m no economist too:)
Ah, fair. Yeah I interpreted your article as calling the value of our baby into question = ).
You are absolutely right that with any crypto there are points of sell pressure as price increases and investors exit/hedge their positions. Remember when btc hit $40 and there was a big sell off? Afterwards, the sell pressure got exhausted and the coin was able to boom. Same concept.
You might be right. BTC was though first alternative blockchain financial system that became a core trading asset on all of the stocks. It’s being slowly recognized as a payment method. Owning BTC is giving you exponentially more options than owning Grid. I don’t see this happening to Grid so the comparison is a bit off in this case I’m afraid. Maybe I’m wrong.
Well, when the price was over 4x what it is now did all the Gridcoin miners sell? Nope. Thats because Gridcoin has value in excess of pure monetary value, many people strongly believe in the mission of aiding science. As you said BOINC has been around for well over a decade, and many people like myself 'threw our money out the window' burning electric for no financial reward. Now consider there are between 400,000 and 2 million people using BOINC and paying their electric, and Gridcoin has reached about 3,000 of them so far. If they join and the coin supply gets constricted by a factor of 100 or more, what might happen to the price?
Will we all sell then, no. Why? Because we aren't going to kill the thing that draws new people to BOINC, it's more than money, it's a mission to improve humanity.
Of course not all of them managed to sell. The reason why the prize went steadily down after the pump was that they were continuously selling after realizing that the growth won’t be steady. As I said I also believe in a "science mission" and I’m not telling anyone not too.
There is a set supply of coins right? So if more people join there will be more competition causing everyone to earn less of those coins. That doesn’t have to influence the prize, but in crypto one never knows:P Or am I wrong.
I believe that everyone in crypto (who doesn’t take it strictly as an investment), who actually believes in the blockchain, sees the effort as a mission to improve humanity:). As i said, I sincerely do hope that your mission will succeed, but i have my doubts.
There was plenty of time to sell, it took weeks to fall back, thats because in my opinion, its not miners selling, its opportunistic traders selling and moving the price.
No way to prove it, thats just my gut feeling.
i agree with you:
most miners of coins sell to cover costs while those "playing" a market will buy low and sell high, which is fine and overall healthy for a market. a market has tendencies and not every rapid rise and drop is a pump and dump. many people use Technical Analysis to place price points and many of these people arrive at the same entrance and exit points which cause rapid spikes and dips as everyone rushes to get as close to these points as possible. maybe.
While we need traders to make liquidity and that is valuable, it does concern me that they are just sucking value out of the cryptosphere back to fiat.
Its a good investment to do crypto. The swing is huge so its quite viable to do swing trading. Wish u all the luck.
Yea Im trying to do some swing trading, but only in low risk circumstances, like pumps, where the token is bound to go back down again. May luck embrace us all:P
Pretty smart move. All the best to u.
This question could be asked about almost all cryptocurrencies. Only a small percentage have actual use cases at this point like Bitcoin and Storj. So many crypto coins cannot be used for anything but trading, speculating and staking. It's the hope that they will eventually be able to be used to pay our bills that keeps us buying them.
You’re right that most of them aren’t really solving anything, but there definitely are plenty that do. Gridcoin is at least not just a copy of BTC and tries to help the science and I do hope that those that have the computing power to at least pay for the electricity loss will continue doing it for the good cause. I do not have such luck now and have to keep searching for coins that will help me grow to the point where I can be doing things just for a good cause too:P. I think that Gridcoin will only go up with the rest of the cryptos and not too much on its own. And if there will actually be a pump, all those guys that are farming the tokens will just sell to pay for that electricity.
I agree, and by the way, I have been mining Gridcoin for about two years now. so I have seen more than a few of it's peaks and valleys. I've even managed to sell close to the peak and buy in the valley a time or two. I do like that they are at trying to work toward a good cause and not just some clone coin.